Connecticut ranks #48 in the nation in income tax refunds its residents receive from the federal government. Just over 11 percent of the taxes paid by state residents to the federal government are refunded to them, a percentage that is better than only the states of Delaware and Minnesota, and the District of Columbia.
By comparison, Mississippi residents receive more than three times that percentage. One third of the taxes paid by Mississippi residents – 34.84 percent – come back in refunds. West Virginia residents receive 30 percent of the taxes they paid, South Carolina 26.27 percent and Alabama 26 percent. Bloomberg.com reviewed Internal Revenue Service (IRS) data and ranked the 50 states and the District of Columbia based on the percentage of gross individual income taxes withheld or paid that were returned as refunds the following year.
Figures are for a five-year period: fiscal years 2007 through 2011 for tax collections and fiscal years 2008 through 2012 for refunds. For both collections and refunds, data include individual income tax withheld, individual income tax payments, FICA taxes, SECA taxes, unemployment insurance taxes, railroad retirement taxes and estate and trust income taxes. Refunds include interest.
Connecticut’s gross total individual federal income tax collected between 2007 to 2011 was $206.31 million. Total individual income tax refunded from the federal government between 2008 to 2012 was $23.56 million. Joining Connecticut among the states with the lowest percentage refunded, in addition to Minnesota and Delaware, are Massachusetts, New Jersey, Ohio, New York and Nebraska.